HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-education-group-holdin" target="_blank" data-smartkarma-citation="entities:18218:1" rel="noopener">China Education Group (839 HK)</a> has retreated 23% from recent high with no regulatory and company news. Given its secured earnings growth outlook, we see an opportunity. </li>
<li>We believe drivers are higher enrollment and tuition, further capacity growth, good progress in overseas education and light capex. There are positive developments in these aspects recently. </li>
<li>CEG may return unused share buyback funds to shareholders via dividend, suggesting a potential resumption of payout. At just 5.7x PER for FY23F, its growth prospect is undervalued.</li>
</ul>



China Education Group (839 HK) has retreated 23% from recent high with no regulatory and company news. Given its secured earnings growth outlook, we see an opportunity. 
We believe drivers are higher enrollment and tuition, further capacity growth, good progress in overseas education and light capex. There are positive developments in these aspects recently. 
CEG may return unused share buyback funds to shareholders via dividend, suggesting a potential resumption of payout. At just 5.7x PER for FY23F, its growth prospect is undervalued.


China Education Group (839 HK): Sustaining Growth Trajectory

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hope-education-group-co-ltd" target="_blank" data-smartkarma-citation="entities:27321:1" rel="noopener">Hope Education Group Co Ltd (1765 HK)</a> achieved good student enrollment quota increase for 2022/2023 academic year and student recruitment results at overseas schools are also very encouraging. </li>
<li>Improvement in teaching quality and better facilities should narrow the gap of fees per student (Rmb11,814) with the national average (Rmb20,000), driving net profit growth in 3-5 years. </li>
<li>Capex will come down over time given good upside in utilisation and the removal of management fees will relieve financial position. Its relative valuation is also inexpensive. </li>
</ul>



Hope Education Group Co Ltd (1765 HK) achieved good student enrollment quota increase for 2022/2023 academic year and student recruitment results at overseas schools are also very encouraging. 
Improvement in teaching quality and better facilities should narrow the gap of fees per student (Rmb11,814) with the national average (Rmb20,000), driving net profit growth in 3-5 years. 
Capex will come down over time given good upside in utilisation and the removal of management fees will relieve financial position. Its relative valuation is also inexpensive. 


Hope Education (1765 HK): More than Just Hopes

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

China Education Group / Equity Capital Markets

<p>China Education Group (839 HK) is looking to raise up to US$154m in its top-up placement. This will be the third placement by the group over the past 15 months.</p><p>We covered the previous placement in Jan 21, China Education Group Placement - Back for More, past Deal Didn’t Do Well.</p><p>In this note, we will look  at the deal dynamics and run the deal through framework.</p>

China Education Group (839 HK) is looking to raise up to US$154m in its top-up placement. This will be the third placement by the group over the past 15 months.We covered the previous placement in Jan 21, China Education Group Placement - Back for More, past Deal Didn’t Do Well.In this note, we will look  at the deal dynamics and run the deal through framework.

China Education Group Placement - Recent Momentum Is Strong but past Deal Record Isn’t Supportive

<div><p><a href="https://www.smartkarma.com/entities/china-education-group-holdin" target="_blank" data-smartkarma-citation="entities:18218:1" rel="noopener">China Education Group (839 HK)</a> is looking to raise up to US$268m in its top-up placement. This will be second placement for the stock in less than six months.  </p></div><div><p>In this note, we will look at the use of proceeds, deal dynamics, and run the deal through framework.</p></div>

China Education Group (839 HK) is looking to raise up to US$268m in its top-up placement. This will be second placement for the stock in less than six months.  In this note, we will look at the use of proceeds, deal dynamics, and run the deal through framework.

China Education Group Placement - Back for More, past Deal Didn't Do Well

Quality-first, Business-perspective, Long-term, Urbem (HK) Limited

Urbem Capital

Quality-first, Business-perspective, Long-term

China Maple Leaf Educational Systems / Equity Bottom-Up

China Maple Leaf Educational Systems (1317 HK)

<ul class="">
<li>Maple Leaf Educational Systems caught our attention for its low price multiples and consistently decent returns on capital;</li>
<li>Both the financial track record and the current valuation look favorable, especially compared to peers.</li>
<li>We examine the business fundamentals with our proprietary framework in search of any value trap.</li>
</ul>


Maple Leaf Educational Systems caught our attention for its low price multiples and consistently decent returns on capital;
Both the financial track record and the current valuation look favorable, especially compared to peers.
We examine the business fundamentals with our proprietary framework in search of any value trap.


Maple Leaf Educational Systems: Deep Value or Value Trap?

China

China New Higher Education Group is a leading private higher education group in the People's Republic of China, providing private education services through its network of universities and colleges. The company focuses on cultivating applied technical talents and also offers technical and management consultancy, technology services, and sells textbooks. It was founded in 1999 and is headquartered in Beijing, China.

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China New Higher Education (2001 HK)

China Education Group (839 HK): Sustaining Growth Trajectory

Higher enrollment and tuition, further capacity growth, good progress in overseas education and light capex are developments that will potentially...

Osbert Tang, CFA

Hope Education (1765 HK): More than Just Hopes

The beaten-down stock has a good enrollment quota growth in China and encouraging overseas student recruitment result. Lower capex and removal of...

Osbert Tang, CFA

China Education Group Placement - Recent Momentum Is Strong but past Deal Record Isn’t Supportive

China Education Group (839 HK) is looking to raise up to US$154m in its top-up placement. This will be the third placement by the group over the...

Sumeet Singh

China Education Group Placement - Back for More, past Deal Didn't Do Well

China Education Group (839 HK) is looking to raise up to US$268m in its top-up placement. This will be second placement for the stock in less than...

Sumeet Singh

Maple Leaf Educational Systems: Deep Value or Value Trap?

With an all-time-low valuation and decent financial track records, does Maple Leaf Educational Systems offers a long-term alpha opportunity?

Urbem Capital

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